By: Mike Hosking | Wednesday, August 15, 2012 11:27 AM

There has been this week the most dramatic of turns in Australia’s long running saga with illegal boat people.

Deadlocked for months on end over any sort of solution as to what to do with all the boats and the people, the Government commissioned an independent report by a bloke called Houston. The only trouble with these sort of reports is that having commissioned them, you’re obligated to act on them when they report back. In very simple terms the report recommends all that Julia Gillard has been trying to avoid. It is a massive win for the opposition and they have spared little if any energy in telling us all about it.

In a nutshell the report suggests offshore processing. The business of having far flung islands where these people end up officially until they can be repatriated somewhere in reality sticks there for the rest of time. In the mix is a thing called the ‘Malaysia Solution’ which is a simple swap of boat people for genuine refugees with Malaysia. The trouble with that piece of genius is two-fold. The ratio of boat people to refugees is absurd, hence Australia would be flooded with refugees it doesn't want and can’t afford, and Malaysia hasn’t signed a lot of internationally recognised documents on how to treat people humanely. Hence the concern that the boat people are to be handed over to who knows who and for a future of who knows what.

The theory behind the offshore processing is that those who leap on board boats in places like Indonesia start to realise that they’re not actually going to end up in Australia, so don’t bother. This, and this is the part that almost defies belief, is what Australia was doing under John Howard. It worked and under the scheme, along with the odd example of simply turning the boats around, Australia’s illegal refugee problem basically trickled to a halt.

Then came Julia who I am increasingly convinced history will show to be one of modern politics’ most disliked, mistrusted and incompetent operators. Anyway, she rolls Kevin Rudd, who by the way wasn’t a lot better than her, and sets about trying to convince us that black is white and letting these people into Australia is a good idea and they can all be processed on the mainland and that won’t be a major cost and detention centres are the way of the future.

It was madness from day one and got increasingly and obviously mad from each day forth. The people smugglers clearly not believing their luck started loading boat after boat and went for broke. In the process, thousands arrived causing the most extraordinary amount of chaos, cost and political fallout. Then you had the hundreds who didn't make it and simply drowned.

While they were drowning and arriving, a political scrap of rare intensity ensued that in the end caused both major parties extreme amounts of damage as Australians got increasingly sick of the lot of them, knowing full well the solution was actually quite easy. The solution (well, part of it) got delivered in the Houston report this week. So one of modern politics’ biggest back downs has begun and if Julia wasn’t toast before it, she is now.

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